News Disney plans to accelerate Parks investment to $60 billion over 10 years

[pdude81]

I do not see them adding meaningful capacity at a time of attendance and resort stay contraction.

They are going to need to start building if they project needing that capacity in the next ten years, when this money is supposed to be spent.

I'm fairly certain the "Beyond Big Thunder" portion will definitely come to fruition because they can't allow Epic Universe to be the "best" theme park in Florida for any significant amount of time. DAK and DHS desperately need more capacity first, but I bet they lean in on MK (announcements) for optics before EU opens.

 

[Tha Realest]

They are going to need to start building if they project needing that capacity in the next ten years, when this money is supposed to be spent.

I'm fairly certain the "Beyond Big Thunder" portion will definitely come to fruition because they can't allow Epic Universe to be the "best" theme park in Florida for any significant amount of time. DAK and DHS desperately need more capacity first, but I bet they lean in on MK (announcements) for optics before EU opens.

I don’t disagree. But they are “house poor” thanks to D+. And already stagnating/contracting in terms of attendance now. They’ve demonstrated themselves to be short sighted in this regard - except when it comes to DCL and DVC.

 

[BrianLo]

I don’t disagree. But they are “house poor” thanks to D+. And already stagnating/contracting in terms of attendance now. They’ve demonstrated themselves to be short sighted in this regard - except when it comes to DCL and DVC.

Disney is massively behind the investment curve in cruises compared to their peers. If you think the investment gap between Universal in Orlando is bad, they are crawling into the cruise industry. There are seven major players and Disney isn’t one of them.

 

[MisterPenguin]

One could argue that Bob’s “plan” was to milk Disney’s assets, particularly the theme parks that he knows nothing about, as well as building more and more DVC cash cows to provide a continually larger shareholder dividends, implement stock buybacks to boost share price, and pad his nest egg. But Bob’s such a nice guy, he’d never do that.

One could argue that Bob is a lizard man sent to destroy our society from within!

 

[BrianLo]

I don’t know why anyone is expecting much at this year’s D23 Expo. Iger has already said most of the investment will come later in the decade. So even if you take him at his word about the $60 billion investment in parks, most of the major announcements wouldn’t come until 2026 & 2028.

I’m sure we’ll get something announced this year. But we’ve essentially already been told to keep our expectations in check so I would advise everyone do so or risk being very disappointed.

That quote comes from their CFO and was that they would ramp up in the back of their promised investment cycle. The back half being q1 October 1 2028 to q4 Sept 30 2033.

Now keep in mind, the doubling of investment is comparing to the previous 10 year cycle. From a WDW lens that includes the entirety of Pandora Spend and Disney Springs Overhaul. More far flung of importance it includes the vast bulk of spend on Shanghai.

Keeping this in mind, a Large investment like Big Thunder coming towards the tail end of this first five years of the promised investment cycle would still largely be a big reduction.

But the capital spend is most notable because they simply aren’t launching a resort and not positioned to, so it would be next to impossible for the company to burn through even more capex than what they did a decade ago (by 2028) even if they wanted to. Or 30 billion in 4.5 years and counting. He was just sort of stating the obvious, it takes time to build things.

We know how this works, even if the dump truck of budgets arrived at Imagineerings door last Sept… it takes them 6 years on average to do the really substantial projects. Using Pandora as our best guideline.

 

[MisterPenguin]

Disney is massively behind the investment curve in cruises compared to their peers. If you think the investment gap between Universal in Orlando is bad, they are crawling into the cruise industry. There are seven major players and Disney isn’t one of them.

Sincere query....

How many are operating at the level of what Disney charges for a cruise? Disney many not be aiming at the cruise line industry as a whole, but looking to corner the elite family cruises.

 

[Tha Realest]

Disney is massively behind the investment curve in cruises compared to their peers. If you think the investment gap between Universal in Orlando is bad, they are crawling into the cruise industry. There are seven major players and Disney isn’t one of them.

I didn’t say they were aggressively pushing into this space as compared to RC and Carnival - I do think they cater to different clienteles in many respects. But, they are like doubling their fleet in the next few years it seems. I think they’re fine with how leveraged they are in this space.

 

[Sirwalterraleigh]

I do not see them adding meaningful capacity at a time of attendance and resort stay contraction.

That cycle should be called “the donut of doom”

 

[BrianLo]

Sincere query....

How many are operating at the level of what Disney charges for a cruise? Disney many not be aiming at the cruise line industry as a whole, but looking to corner the elite family cruises.

Fair and you know, on the level, I read positive on most things Disney.

Royal Caribbean is head and shoulders ahead of them cornering the family market. From a tech, cost, family offerings, density of things to do on their ships. Simply in terms of berths as well they are launching basically the equivalent of Disneys entire fleet over their next two ships.

Disney offers a very good product, some of the things they offer are even a bit premium comparatively, but it’s very expensive product. Disney is leveraging IP in a way that most other cruise lines don’t and for some that justifies a huge premium. But we are largely talking about double the price. Royal is what is advancing the industry and they are pushing more aggressively into being a family-first brand.

For non family cruisers, NCL offers more interesting and long itineraries, they are very solo friendly. Celebrity is a more premium product than Disney or Royal, but still comes in cheaper than Disney. Though both brands offer kids activities, programming and spaces, they tend to attract an older demographic on longer, more exotic itineraries. Princess is also more premium, but even less kid focused.

Carnival has historically been the Six Flags, but their newer ships are pushing upwards. MSC seems to be the new cheap, cheap mass market product on the block from the European lens. I haven’t done either.

As a childless millennial I skew Disney then Universal. Cruise wise I skew NCL, Celebrity, Royal, supposedly Virgin (haven’t done it, they are new to the block, only have a few ships and adult only)… then maybe Disney.

 

[Sirwalterraleigh]

Sincere query....

How many are operating at the level of what Disney charges for a cruise? Disney many not be aiming at the cruise line industry as a whole, but looking to corner the elite family cruises.

Nothing about anything Disney does is “elite” or “luxury”

Including dcl

Eventual everyone will learn instead of trying to coddle themselves with those labels

 

[Sirwalterraleigh]

Fair and you know, on the level, I read positive on most things Disney.

Royal Caribbean is head and shoulders ahead of them cornering the family market. From a tech, cost, family offerings, density of things to do on their ships. Simply in terms of berths as well they are launching basically the equivalent of Disneys entire fleet over their next two ships.

Disney offers a very good product, some of the things they offer are even a bit premium comparatively, but it’s very expensive product. Disney is leveraging IP in a way that most other cruise lines don’t and for some that justifies a huge premium. But we are largely talking about double the price. Royal is what is advancing the industry and they are pushing more aggressively into being a family-first brand.

For non family cruisers, NCL offers more interesting and long itineraries, they are very solo friendly. Celebrity is a more premium product than Disney or Royal, but still comes in cheaper than Disney. Though both brands offer kids activities, programming and spaces, they tend to attract an older demographic on longer, more exotic itineraries. Princess is also more premium, but even less kid focused.

Carnival has historically been the Six Flags, but their newer ships are pushing upwards. MSC seems to be the new cheap, cheap mass market product on the block from the European lens. I haven’t done either.

As a childless millennial I skew Disney then Universal. Cruise wise I skew NCL, Celebrity, Royal… then maybe Disney.

The amount I’m starting to agree with you is starting to freak me out

 

[DisneyDodo]

That quote comes from their CFO and was that they would ramp up in the back of their promised investment cycle. The back half being q1 October 1 2028 to q4 Sept 30 2033.

Now keep in mind, the doubling of investment is comparing to the previous 10 year cycle. From a WDW lens that includes the entirety of Pandora Spend and Disney Springs Overhaul. More far flung of importance it includes the vast bulk of spend on Shanghai.

Keeping this in mind, a Large investment like Big Thunder coming towards the tail end of this first five years of the promised investment cycle would still largely be a big reduction.

But the capital spend is most notable because they simply aren’t launching a resort and not positioned to, so it would be next to impossible for the company to burn through even more capex than what they did a decade ago (by 2028) even if they wanted to. Or 30 billion in 4.5 years and counting. He was just sort of stating the obvious, it takes time to build things.

We know how this works, even if the dump truck of budgets arrived at Imagineerings door last Sept… it takes them 6 years on average to do the really substantial projects. Using Pandora as our best guideline.

The spending itself will come in the back half of the cycle, not the openings. Which means shovels won’t hit the ground for most of what they plan to build until 2028 and beyond. That doesn’t mean we’ll get nothing in the meantime, but the bulk of the new projects are likely to open in the 2030s, not the 2020s (assuming they follow through on these commitments).

 

[Sirwalterraleigh]

The spending itself will come in the back half of the cycle, not the openings. Which means shovels won’t hit the ground for most of what they plan to build until 2028 and beyond. That doesn’t mean we’ll get nothing in the meantime, but the bulk of the new projects are likely to open in the 2030s, not the 2020s (assuming they follow through on these commitments).

That’s a disastrous way to manage destination parks…which have always suffered from stagnation due to time

It’s malfeasance…and he’ll give himself another contract extension for it

 

[Jrb1979]

That’s a disastrous way to manage destination parks…which have always suffered from stagnation due to time

It’s malfeasance…and he’ll give himself another contract extension for it

I really do believe Iger and company don't understand the parks at all. They are below them

 

[BrianLo]

The amount I’m starting to agree with you is starting to freak me out

I told you, we have always been more aligned than you gave me credit for. Just not about our opinions on some movies or my general optimism.

I'm just not as personally invested in WDW specifically as everyone else is either. Or better boundaries? Which weirdly comes out the other end as being more positive than average.

 

[SpectreJordan]

So when they take out Dinoland for 2-5 years, DAK will be even more worth the $129 starting price for a day ticket.

If they actually cared then they'd build South America as an actual expansion & then start remaking Dinoland after SA is done. Or they should lower the price of DAK until SA is done.

This is fun

My opinion as to what properties they need to Lean into…based on lack of oversaturation and product appeal longterm:

Tangled
Big hero
Moana
Nemo
Encanto

What would you want to do with Nemo? It already has a show & a ride. Though, I wouldn't be opposed to the current ride going back to what it was & Nemo getting a much better dark ride somewhere else.

With the exception of DAK/DHS, the other parks really doesn't need to expand its footprint currently, rather gut or utilize the space more efficiently.

Magic Kingdom

• Hall of Presidents is a 700-seat capacity theater in the middle of the park... prime real estate for something more popular
• Country Bear Jamboree (if it's a success, I'd be cautious about all the other continuous running theaters at the parks)
• Tiki Room (I don't want them to touch this, it's my favorite attraction at MK), but I'd be lying to myself if it's not in someone's idea plan to make it more appealing to most guests
• Carousel of Progress
• Stitch

Epcot

• Awesome Planet
• Imagination Theater
• Figment
• Gran Fiesta Tour
• China 360*
• Canada 360*
• Mission: Space
• Wonders of Life
• Something more permanent at Odyssey? I'd imagine once the remaining 25% of Epcot's hub reopens, it'll allow them to move some festival stuff there.

*I think running a more child-friendly (IP filled) option during the day like the Beauty and Beast singalong would do well, and then return to normal show later in the day.

Hollywood Studios

• All of Animation Courtyard
• If they can get 2 high-capacity attractions into the park, I think they can then phase in heavy refurbs for a few of the E-tickets suffering downtime daily

Animal Kingdom

• Only park to benefit from actual expansion (due to lack of attractions), outside of replacing the Bird Show with something good and River of Light amphitheater.

The Bird show is one of the best shows at Disney! It's so magical. It's a great way to show how wonderful birds are. DAK could use more shows like that tbh.

I also don't really see what they could do with Tiki Room besides an update like the Bears are getting. Maybe the same for Carousel too, but I think that should absolutely be kept.

 

[BrianLo]

The spending itself will come in the back half of the cycle, not the openings. Which means shovels won’t hit the ground for most of what they plan to build until 2028 and beyond. That doesn’t mean we’ll get nothing in the meantime, but the bulk of the new projects are likely to open in the 2030s, not the 2020s (assuming they follow through on these commitments).

The spending will "ramp up in the back half of that 10 year period, with more gradual increases in the first few years" was the actual quote.

Though I think we are largely saying the same thing, you are just implying to expect very little in the next five years. Something major opening in 2027 does not preclude a spending ramp. Especially since they are not really investing in DCL beyond 2025 at this current juncture, other things need to take over in that 26/27 fiscal window. Before someone comes at me about it, Royal's newest ship order was for 2028, I don't think DCL can order in 26/27 at this point.

It is also a quote about their global portfolio. Some of that non-WDW spending ramp probably includes a Shanghai gate and maybe even a Paris one at the very end of things. Those will be obviously expensive and I think be major contributors to the back half.

 

[Indy_UK]

Disney is massively behind the investment curve in cruises compared to their peers. If you think the investment gap between Universal in Orlando is bad, they are crawling into the cruise industry. There are seven major players and Disney isn’t one of them.

While they have cut a few corners, a new private Island and 4 ships within 6 years or so is a good addition for DCL.

At the prices they are charging, I think they’ll struggle to fill all of them

 

[BrianLo]

While they have cut a few corners, a new private Island and 4 ships within 6 years or so is a good addition for DCL.

At the prices they are charging, I think they’ll struggle to fill all of them

Yes, it's actually been a reasonably good investment cycle for DCL. I think I'm just one of the few people who is not against them keeping that pacing up. Especially when their competitors are launching ships with double the occupancy annually.

I also think DCL is over-priced and fortunately, because it is so, has room to discount and still do very well for themselves. A 12-15 ship fleet at a 50% premium over the industry is better than a 7 vessel fleet at a 100% mark up. DCL still has some very under-served markets to move ships towards, because they are so small of a fleet.

 

[pdude81]

That’s a disastrous way to manage destination parks…which have always suffered from stagnation due to time

It’s malfeasance…and he’ll give himself another contract extension for it

I can see another stint as "Executive Chairman" depending on who they choose as tribute. But they would invite more proxy challenges should the board not find a new CEO in time.